Validity, Renewal, and Compliance Under 80G(5) Registration Rules

[Ishita Ramani]

To empower charitable agencies and encourage donations, the Income Tax Act, 1961 gives 80G(5) registration, which permits donors to claim deductions on their donations.

In this article, we will get to know about the validity and compliance rules for 80G(5) Registration.

What is Section 80G5 Registration?

Section 80G(5) registration allows NGOs and charitable trusts to offer tax benefits to their donors. When an NGO is registered under 80G(5), people who donate to it can claim deductions on their income tax, encouraging more donations and support for the cause.

Validity of 80G(5) Registration

All current 80G(5) registrations were required to be revalidated after the Finance Act, 2020.

• New registrations granted under Form 10A are legitimate for 5 years.
• Temporary registrations (provisional) are legitimate for 3 years or until the NGO receives a permanent registration.
• Renewal should be accomplished before the expiry to avoid lapse.

Renewal of 80G(5) Registration

• NGOs must apply for renewal at least 6 months before the expiry of their cutting-edge registration.
• The application is filed via Form 10AB on the Income Tax portal.
• Renewal additionally follows a 5–12 month validity cycle after each approval.
• Delay in renewal may additionally bring about loss of tax advantages for donors.

Compliance Requirements

• Annual Filing: File Income Tax Return (ITR-7) within the due date.
• Audit Requirements: Maintain proper books and get debts audited if profits exceed the limit.
• Activity Reporting: Disclose sports and economic details through prescribed forms.
• Transparency: Avoid sports associated with religious or political promotion.

Benefits of Staying Compliant

• Continued donor trust and extended contributions
• Smooth renewal process without complications
• Avoidance of consequences and registration cancellation
• Enhanced transparency and credibility

Conclusion

Staying updated with the validity, timely renewal, and compliance of 80G(5) registration guarantees that NGOs not most effective stay eligible for donor incentives but also maintain a strong standing.